Stocks up, dollar down

Good morning

A weaker USD this morning sees most majors higher, EURUSD is up to near 0.9900 and GBPUSD has traded up through 1.1400 to reach 1.1430 before slipping back to 1.1390 where we trade now. My first thought was whether Japan had intervened again but with USDJPY still mid to high 144s it is clear they haven’t.

RBA did raise rates but only by 265bps, well done to those who saw that coming. AUDUSD dropped from 0.6500 to 0.6450 but this UDS weakness we have seen this morning has taken the pair up to 0.6540. GBPAUD had a bit of a rollercoaster, it traded from around 1.7360 all the way up to 1.7500, then back down to 1.7370. Now at 1.7455.

A healthy rise in global equities also seems to suggest slower rate rises could be on the table. I do wonder whether markets are looking at RBA’s smaller than expected rise, which comes as a result of their concern for the global economy, and wondering whether other central banks, specifically the Fed, will look to slow the rate of their rate increases. A few Fed officials speak today, I would not be surprised if they stick with their regular message that Fed still have a lot more to do.

Credit Suisse still very much in the spotlight despite their best efforts to reassure the markets that they are in good shape. We’ve seen it before, a glimmer of concern over a financial institution can see funds pulled which in turn exacerbates the situation.

Talk that several UK property funds are limiting withdrawals shouldn’t come as a major surprise given their general liquidity issues but it never makes good reading.

Big talk that Putin has ordered a train that is linked to nuclear munitions to the Ukraine front line. Some may see this as a bluff but it is dangerous to underestimate the lengths Putin could go to.

RBNZ rate announcement due tonight, they are expected to raise rates 50bps to 3.5% although of course the market may begin to look for a smaller 25bps rise after the RBA.

Got to leave it there, running a bit late already. Wife has Covid again, fortunately nowhere near as bad as last year when as you know she was hospitalised and really pretty rough. Have to say Covid seems to be making a big return, I know many, many people testing positive now but fortunately none that I know of are seriously ill, much more like a common cold or a bad sore throat.

- 14.00 Feds Williams speaks

- 14.15 Feds Mester speaks

- 15.00 US factory orders

- 18.00 Feds Daly speaks

- 23.00 AUS S&P services PMI

- 02.00 RBNZ rate announcement